IPO stands for Initial Public Offerings. This is a method that companies use to go public which will make the shares available in secondary markets ie; NSE and BSE.
Few roles of registrar involve, processing of IPO applications, allocate shares to applicants based on SEBI guidelines, process refunds and transfer the allocated shares to the demat accounts.
With the help of FPO, companies issue additional shares of its stock to the public which are already traded in markets.
Primary Market: It is the financial market where new securities (stocks, bonds, etc) are issued and traded for the first time.
Secondary Market: Financial market where existing securities that have been already issued in primary market are bought and sold by investors and traders.
The life cycle of an IPO involves several stages, from initial decisions to go public to ongoing activities after IPO.
Life cycle of an IPO prospectus involves 3 stages which include:
a) Draft Offer Document.
b) Offer Document
c) Red Hearing Prospectus
In book building issue the IPO price is in range which we call price band, whereas in fixed price issue, the IPO price is fixed.
Floor price is the minimum acceptable price for bids during the book building process set by the issuer at the beginning of the IPO, whereas cutoff price is the final price at which shares are allotted to investors.
- Retail Individual Investors(RII) are those who can apply upto 2 Lakh in IPO
- Non Institutional Investors(NII) are those individual investors who bid for more than 2 Lakh Rupees in IPO.
- Qualified Institutional Buyers(QIB) are Financial Institutions, Banks, FIIs and mutual funds who are registered with SEBI.
-Anchor Investors are those institutional investors who are offered shares in IPO but the minimum amount is Rs 10 Cr.
Yes off course one can invest in Non-Institutional category. The only advantage will be that there will be no limit of 2 lakh as it is in RII’s case.
The disadvantage of applying in this category will be that only 15% of total ipo size is allotted to this category whereas RIIs are allotted 35% of total IPO size.
Yes, according to SEBI regulations, it is mandatory to have a PAN number to apply in an IPO.
The issue must remain open for 3 working days and can be extended by, but not more than 10 days.
After applying an IPO, one should make sure to retain the following information:
- Application Form Copy
- Cheque Photocopy
- In case of online IPO submission, the application number is to be kept.
Market Lot Size - The minimum amount of shares that one may get in an IPO is known as the market lot size.
Minimum Order Quantity - The minimum number of shares that can be bought or sold on an exchange to participate in IPO.
No. As IPO is a bidding process, the allotment depends upon the number of bids received in the different categories.
No, not really. IPO’s are an excellent way to enter in stocks. However there may be few risks involved while applying to an IPO.
No, according to SEBI rules one can not apply to an IPO with the same name and details.
Opening periods may differ in different kind of issues.
Basis of allocation/allotment is the process of allocating shares to investors during an IPO.
Once an IPO application is submitted, it cannot be revised. However, some platforms may allow the cancellation of applications before the IPO closure.
IPO application forms are generally available through various channels, including designated banks, financial institutions, and online trading platforms.
In most cases, minors are not allowed to apply for an IPO directly. The application needs to be made by a guardian on behalf of the minor.
Consider the company's financials, industry trends, management quality, and the purpose of the IPO. Additionally, analyzing the company's prospectus can provide valuable insights.
Yes, individuals, corporate bodies, and other entities can apply in the non-institutional bidder category of an IPO.
The minimum and maximum investment amounts for the High Net Worth Individual (HNI) category vary and are specified in the IPO prospectus. The minimum amount is 2 lakhs with no upper limit.
Generally, buy orders for IPO shares can only be placed once the stock is listed on the exchange. However if one is applying for an IPO lot then timings are from 10:00 am to 5:00 pm.
Investors can apply for IPOs online through their respective bank's net banking portal or through online trading platforms.
The IPO listing price is often determined through a book-building process where investors bid for shares at various prices. The final price is based on demand and supply dynamics.
A Rights Issue is when a company offers existing shareholders the right to buy additional shares at a discounted price.
The RII bidding status may not be updated every hour due to procedural and system considerations. Investors can typically check the status periodically.
Risks include market volatility, industry-specific challenges, regulatory changes, and company-specific risks. These are outlined in the IPO prospectus.
Yes, joint demat account holders can apply for an IPO, and each can apply individually.
The limit of Rs 2 lakh for retail investors is a regulatory safeguard to prevent excessive concentration of wealth in a single IPO.
Factors include financial performance, industry outlook, management quality, and overall market conditions
Capital gains tax on IPO returns depends on the holding period and the prevailing tax laws in the investor's jurisdiction.
The withdrawal option for IPO applications is generally not available. Once applied, investors are committed to the process.
Direct listing or listing through other methods, such as a merger with a Special Purpose Acquisition Company (SPAC), allows a company to list without a traditional IPO.
The duration an IPO remains open is specified in the IPO prospectus. It can vary but is typically open for 15 days and can go upto 30 days.
Minors can apply through their guardian in the IPO.
Over-the-Counter (OTC) trading involves the direct trading of financial instruments between two parties without a centralized exchange.
Generally, selling allotted shares before listing is not allowed. Stocks need to be listed on an exchange for trading.
Investors can apply for an IPO online through their bank's net banking portal or through online trading platforms using the UPI mechanism.
The category for a private family trust depends on the trust's status and the criteria set by the IPO.
Private family trust may be eligible to subscribe in the non-institutional category based on the IPO guidelines.
Yes,Private limited companies are eligible to subscribe in the non-institutional category based on the IPO guidelines.
Pre-IPO placement involves selling shares to institutional investors before the IPO. It can provide early funding and establish valuation benchmarks.
Qualified Institutional Buyers (QIBs) are institutional investors like mutual funds, insurance companies, and foreign institutional investors. The rules and regulations for QIBs vary by jurisdiction.
The listing of an IPO usually takes place within 7 working days from the closing date of the issue.
A call option gives the holder the right, but not the obligation, to buy an asset at a specified price. A put option gives the holder the right, but not the obligation, to sell an asset at a specified price.
The listing of an IPO refers to the process of the company's shares becoming available for trading on a stock exchange. This is facilitated by the exchange after the IPO is successfully completed.
The time taken for a cheque to be cleared for an IPO application can vary, but it typically takes a few days. In case of refunds it usually takes 3-5 days.
Lead Managers of an IPO determine the final price based on the weighted average figures of all the bids received. The final price determined through this process is cut-off price.
Bid Quantity is the number of shares an investor is willing to buy or sell, while Bid Price is the price at which the investor is willing to buy or sell those shares.
IPO stands for Initial Public Offering
IPO funding refers to the capital raised by a company when it goes public by offering its shares to the public for the first time.
Syndicate members play a crucial role in the IPO process by helping in the distribution of shares to investors and managing the book-building process.
The timeline for book building IPOs in India is specified in the offer document, and it typically includes the bidding period, allotment, and listing.
Companies may choose a shorter bidding period for various reasons, such as market conditions or regulatory requirements. The minimum duration is 3 days, and the maximum is 7 days.
Investors can apply for multiple lots using different PANs or different demat accounts.
Multiple IPO applications can be made from one bank account using ASBA, but the total amount should not exceed the ASBA limit set by the bank.
IPO applications can be filed online through net banking (ASBA), physical forms, or through intermediaries like brokers.
The number of IPO applications through online net banking depends on the bank's policy, but typically, 5 applications can be made.
Yes, an investor can apply for an IPO from their current bank account using the ASBA facility.
It depends on the specific features and restrictions of the sweep-in/out facility provided by the bank.
Yes, an investor can apply for an IPO in the name of family members and friends using their own bank account.
Yes, an investor can apply for more than one IPO application from different saving bank accounts in the same or different banks.
The PAN number and the demat account details are primary fields that make an IPO application unique.
The primary account holder of the joint demat account is typically considered as the applicant in an IPO application.
Yes, IPO applications can be made in the name of a minor or a Hindu Undivided Family (HUF) with the appropriate documentation.
For retail category the maximum number is 15 lots. Applying for the maximum number of lots may increase the chances of receiving a higher allocation in the retail category.
These factors may not significantly impact IPO allotment. Allotment is typically based on the random selection process or pro-rata basis.
Allotment details are usually available a few days after the IPO closes, and investors can check the status online.
The credit of IPO shares to the demat account is typically done within a week of the allotment.
Unused funds blocked for IPO are generally released soon after the allotment process is completed.
The listing of IPO shares occurs on the stock exchange within a week of the allotment.
The last time to apply in an IPO is typically until the closing time on the last day of the IPO subscription period.
It is not necessary to submit multiple bids; investors can submit a single bid at the desired price.
In online bidding, the system automatically takes the discount offer. However, in physical applications, one is asked for the bid price, discount and the net price.
Bidding at cut-off price indicates that the investor is willing to buy at whatever price is determined through the book-building process.
Investors can either withdraw their application or continue with the original application in case of a price band reduction.
Subscription figures of an IPO are available on the stock exchange website and financial news portals during the subscription period.
Early price discovery occurs in the pre-open session on the listing day, where the stock's initial price is determined.
Offline applications can be made by submitting physical forms to designated banks or intermediaries during the IPO subscription period.
Investors can apply online through their bank's net banking portal using the ASBA facility, even if their broker does not offer IPO services.
No, an individual cannot apply in both the retail and HNI category for the same IPO.
There may be eligibility criteria for NII, and it is not solely based on the minimum investment. Specific criteria are mentioned in the IPO prospectus.
No, applying for an IPO with a friend's PAN in one's demat account is not permissible.
No, there is typically no different application form for NII and retail investors; both can use the same form.
The procedure for applying in the NII quota is generally the same, whether applying in physical or online mode.
Circuit breakers may be applied during the IPO listing to control extreme volatility, but this is subject to regulatory decisions.
IPO shares can be sold during the special pre-open time on the listing day through the stock exchange platform.
IPO applications can generally be submitted online on any day during the IPO subscription period, including Sundays.
IPO shares can be sold through the stock exchange once they are listed, using trading platforms provided by brokers.
Short-term gains in IPOs depend on market conditions and the performance of the specific stock. Past performance is not indicative of future results.
Old IPO offer documents can be obtained from the official website of the stock exchange or from regulatory authorities.
Investors can get updates on upcoming IPOs through financial news portals, the stock exchange website, and from their brokers.
Benefits: Increased chances of higher allotment. Disadvantages: Higher investment risk if the stock performs poorly.
The listing date is typically announced by the stock exchange and can be found on the exchange's website or financial news portals.
Generally, IPO applications cannot be made directly using FD funds. ASBA facility through a savings/current account is the common method.
Yes, a retail investor can apply for more than 2 lakh in an IPO, but it falls under the High Net Worth Individual (HNI) category.
Returns from an IPO vary based on market conditions and the performance of the company. There is no guaranteed return.
Yes, SME IPOs can often be applied for through online banking using the ASBA facility.
Individual investors typically fall under the retail category when applying for an IPO.
'DP Name' refers to the name of the Depository Participant (DP) or the institution where the investor holds their demat account.
The lien amount is automatically released after the IPO allotment process if the shares are not allotted.
Consider factors such as the company's financials, industry trends, and the purpose of the IPO. Consult with financial advisors for personalized guidance.
Information on the number of applications is usually available on the stock exchange's website or through the registrar's website.
The minimum reserve portion for the retail category in an IPO is specified in the IPO prospectus and is 35%.
Yes, investors can apply for an IPO through ASBA without a trading account. The ASBA facility is linked to the bank account.
The issue price is the price at which shares are offered in the IPO, while the listing price is the price at which they start trading on the stock exchange.
The time taken to launch an IPO after SEBI's approval can vary, but it is typically within a few weeks.
The exact date of an IPO is announced by the company and can be found in the IPO prospectus and on the stock exchange's website.
The upper price is the maximum price at which bids can be placed, while the cut-off price is the price at which investors bid when they don't specify a particular price.
It may not significantly impact the allotment process; however, the final allotment depends on the demand at different price levels.
The list of registered main syndicate members can usually be obtained from the issuer's website, stock exchange website, or the lead manager.
ASBA payments typically need to be made from the applicant's bank account. Payments from someone else's account may lead to rejection.
If an error is detected after the IPO closes, it is advisable to contact the registrar or the company for guidance on rectification.
Applying for an IPO with a loan is generally not recommended, as it adds financial risk, and using borrowed funds for investment involves interest costs.
Investors can apply in an IPO through the ASBA facility provided by their banks, either online or by submitting physical forms.
Public Issue involves offering shares to the public, Right Issue offers existing shareholders additional shares, Bonus Issue provides free shares to existing shareholders, and Private Placement is a non-public offering to select investors.
The steps include company preparation, filing with SEBI, marketing, opening of the IPO, closing of the IPO, allotment, listing, and post-listing activities.
Once an online IPO bid is submitted, it cannot be canceled. Investors must exercise caution and verify details before submitting.
In a fixed price issue, the price is pre-determined, while in a book-built issue, the price is discovered through the bidding process.
Investor categories include Retail Individual Investors (RII), Non-Institutional Investors (NII), Qualified Institutional Buyers (QIB), and Anchor Investors.
Investors usually receive an SMS or email confirmation as an acknowledgement for ASBA IPO applications.
No, an investor cannot apply in both categories simultaneously. It is one or the other based on the investment amount.
Retail investors are not eligible to apply in the NII quota. NII is reserved for institutional and high-net-worth investors.
Yes, an investor can apply in both categories separately by submitting separate applications.
Pros: Higher allocation potential.
Cons: Higher minimum investment requirement, and allotment is not guaranteed.
QIBs are institutions that participate in the IPO, while anchor investors are a subset of QIBs who invest before the IPO opens to anchor the offering.
Yes, HNIs can be allotted shares from the NII reserved allocation.
Investors can apply for a specific number of lots or specify the amount they want to invest in an IPO.
Yes, investors with a joint demat account can apply for an IPO using the same demat account with a joint bank account or different bank accounts.
The HNI category is usually selected during the online application process when choosing the investor category.
As of my last update in January 2022, the BHIM app is not commonly used for IPO applications. Investors usually use the ASBA facility offered by banks.
AMO can be placed between 3:45 PM and 8:57 AM for the next trading day in Sharekhan.
Companies can apply for IPOs using their demat accounts through the ASBA facility provided by their banks.
Generally, third-party ASBA is not allowed. ASBA applications need to be from the bank account of the applicant.
The use of third-party UPI in IPO applications may be subject to specific rules, and it is recommended to check with the respective bank.
The acceptance or rejection depends on the policies of the bank and the IPO registrar.
Oversubscription occurs when the demand for shares in an IPO exceeds the number of shares available.
HNI (High Net Worth Individual) and NII (Non-Institutional Investor) are different investor categories, each with its own eligibility criteria and minimum investment requirements. For NII 15% of the IPO offer is reserved.
Pros: Higher potential allocation.
Cons: Higher minimum investment requirement, and allotment is not guaranteed.
Yes, HNIs can be allotted shares from the NII reserved allocation.
To apply for an SME IPO, investors can use the ASBA (Applications Supported by Blocked Amount) facility provided by banks. They need to fill in the IPO application form and submit it to the Self-Certified Syndicate Bank (SCSB), specifying the bid details.
Yes, individual investors can apply for SME IPOs.
Lot size refers to the minimum number of shares that investors can apply for in an IPO. It is determined by the company issuing the IPO.
An IPO price band is a range within which investors can bid for shares. The final issue price is determined through the book-building process based on investor demand.
The issue size is the total value of shares offered for subscription in an IPO.
In a book-building issue, the price is determined through a bidding process, allowing investors to bid within a price range. In a fixed price issue, the price is pre-determined by the company.
The cut-off price is the final issue price decided after the bidding process in a book-building issue. The floor price is the minimum price at which bids can be made.
Anchor investors are institutional investors who participate in the IPO before the bidding process opens. They help create investor confidence and stability.
Yes, bidders can revise their bids during the bidding period in a book-building issue.
The bid period in a book-building issue must be open for a minimum of three days.
In book building, the price is determined through a bidding process, while in a normal public issue, the price is fixed in advance.
Investors can check IPO application and allotment status on the websites of the stock exchanges or the registrar's website.
Market lot size is the minimum number of shares that can be traded, while minimum order quantity is the minimum number of shares investors can apply for in an IPO.
IPO investments carry their own risks, and the level of risk depends on various factors. It's essential for investors to conduct thorough research before investing.
High-net-worth individuals, corporate bodies, and trusts can apply in the non-institutional bidder category.
GMP stands for Grey Market Premium, which reflects the difference between the expected listing price of an IPO and the IPO price in the unofficial market
IPO stands for Initial Public Offering, and investors can participate by opening a Demat account, submitting bids through banks, and checking allotment status after the IPO.
Basics of an IPO include understanding the offering company, its financials, the IPO process, and the potential risks and returns.
Different types include Book Building IPO, Fixed Price IPO, SME IPO, and Offer for Sale (OFS).
Benefits include the opportunity to invest in a company in its early stages, potential capital gains, and the ability to trade shares on the stock exchange.
Beginners should research the company, understand the IPO process, assess risks, and consider long-term investment goals.
An IPO involves a company issuing shares to the public for the first time, allowing investors to buy these shares and become part-owners of the company.
Investors can apply for IPOs online through their Demat accounts using the ASBA facility provided by banks.
The application process involves filling out the IPO application form, submitting it through a bank, and monitoring the allotment status.
The IPO process includes due diligence, filing a draft red herring prospectus (DRHP), book building or fixed price offering, and listing on the stock exchange.
An IPO calendar provides information on upcoming IPOs, including their opening and closing dates and listing dates.
An IPO registrar is a financial institution responsible for processing IPO applications, allocating shares, and managing the refund process. They play a crucial role in the IPO process.
Lead Managers play a crucial role in the IPO process, acting as intermediaries between the company going public and potential investors. They assist in the preparation of the IPO prospectus and other documentation required for regulatory approval. Lead Managers coordinate with various parties involved, such as legal advisors, auditors, and underwriters.
There are various risks involved with an IPO application which include market risk, regulatory risk, business risk and price fluctuation.
In many jurisdictions, a PAN (Permanent Account Number) is a mandatory requirement for IPO applications. It helps track financial transactions for taxation purposes.
The duration of an IPO bidding period varies but is typically open for 3-21 days.
Market Lot: The minimum number of shares that can be bought or sold in a single transaction.
Minimum Order Quantity: The smallest quantity of shares an investor can apply for in an IPO.
In general, once an IPO application is submitted, changes or cancellations are not allowed. Investors should carefully review their information before submission.
Minors are generally not allowed to apply for an IPO directly. Legal guardians or parents may apply on their behalf.
The listing price is often determined through a process involving the company, underwriters, and market conditions. It is not fixed by any single entity.
IPO stands for Initial Public Offering. It is the process by which a private company becomes publicly traded by offering its shares to the general public for the first time.
Contact Fidelity or check their platform for information on upcoming IPOs.
These documents are typically provided by the company or its underwriters and can be obtained from Fidelity's platform or through direct contact.
Eligibility criteria may vary. Generally, Fidelity eligibility rules require $ 2000 in any account from which IPO bid is entered.
New issues are not marginable for atleast 30 days following pricing.
Information on share allocation and pricing is usually provided in the allotment advice.
After the IPO shares are listed, investors can sell them on the stock exchange
Companies go public to raise capital, increase visibility, and provide liquidity for existing shareholders
A legal structure where an investor has a controlling interest despite not having a majority of voting rights
The offer price is determined at the end of the bidding process. The offering price is set in advance.
The offering price is determined based on factors such as company valuation, market conditions, and investor demand.
Trading typically begins on the stock exchange a few days after the IPO is priced.
Fidelity allocates shares based on various factors, including client demand and account size.
To participate in an IPO, you'll need to have an account with a brokerage firm that is participating in the IPO. Not all brokerages offer access to every IPO, so choose one that does.
Confirming your indication of interest is crucial because it allows you to reconfirm your desire to participate in the IPO.
Typically, you can modify or cancel your indication of interest before the deadline set by your brokerage or the underwriters. This deadline is usually a few days before the IPO goes public. After this point, you may not be able to make changes.
Bidding at the upper band can be a strategy to signal a higher willingness to pay for the shares, but it doesn't guarantee a larger allocation. The allocation process is influenced by factors such as demand, the number of available shares, and the underwriters' allocation methodology.
